BaFin gains expanded supervisory powers: How insurers should prepare

With the Banking Directive Implementation and Bureaucracy Reduction Act (‘BRUBEG’), announced on 30 March 2026, German legislature has not only implemented the ‘EU Banking Package’ but has also expanded the powers of the insurance and financial supervisory authorities. Primary aim of these legislative changes is to enable a more effective investigation of the facts, particularly in cases where an authority’s request for information is unlawfully refused, delayed or obscured. Supervised companies should prepare for the new investigative risks.

The BRUBEG has entered into force in its key provisions. The new Act transposes the sixth EU Capital Requirements Directive for banks (CRD VI) into German law and is intended to reduce unnecessary bureaucratic burdens on credit institutions.. In addition, the Act introduces a number of innovations for a more effective financial market supervision, in particular an expansion of investigative powers of the German Federal Financial Supervisory Authority (Bundesanstalt für Finanzdienstleistungsaufsicht – ‘BaFin’).

Overview of the main amendments to the German Insurance Supervision Act (VAG)

The most important changes that BRUBEG has brought for insurance companies and other entities regulated under the German Insurance Supervision Act (Versicherungsaufsichtsgesetz – ‘VAG’) are summarized below.

For an in-depth analysis of the legislative changes, please refer to the article by our expert Thomas Wismann, published in the German Journal of Insurance Law (VersR 2026, 273).

Duty to provide information and produce documents even after leaving office

In future, BaFin may generally request information and documents from board members, employees and controlling persons even after they have left the board or company (Section 305(1) VAG). This power was previously limited to suspected cases of unauthorised insurance business.

Introduction of a general right of search

With immediate effect, BaFin’s right of search is also no longer limited to cases of unauthorised insurance business. The premises of supervised undertakings and of (including former) board members may now be searched whenever there are facts that justify the assumption that information or documents have not been provided, or have been provided incorrectly, incompletely or late, thereby hindering BaFin’s investigation of a relevant matter (Section 306(5) sentence 1 VAG).

Amendment of powers to prosecute unauthorised insurance business

BaFin’s investigative powers regarding insurance undertakings suspected of operating without authorisation, which were previously regulated in scattered provisions, have been consolidated in the new Section 306a VAG. What's new is the supervisory authority’s power to search individuals in order to secure evidence.

Liquidator as insolvency administrator

Section 308(5) sentence 2 VAG clarifies that the liquidator may, in principle, also be appointed as insolvency administrator. Utilising the preparatory work is intended to significantly speed up the process and reduce costs.

Extension of “naming and shaming” for breaches

BaFin already regularly publishes final measures and unchallengeable penalty decisions. Under the BRUBEG, the authority is obliged, as a rule, to also disclose information on the nature and character of the breach without conducting a further proportionality assessment. In the case of breaches of the Insurance Distribution Directive (IDD), BaFin is even obliged to publish such information. Furthermore, the maximum publication period of five years is being converted into a minimum period.

What regulated companies need to do – and how Oppenhoff can help

The extended investigative powers apply to primary and reinsurance undertakings, including cross-border EU and EEA insurers, and other undertakings supervised under the VAG.

The legislative amendments came into force on 31 March 2026. Affected companies should therefore prepare without delay for the new investigative risks:

Clear processes for disclosure and production orders

Responsibilities and procedures for requests for information and searches, including those involving former board members and employees, should be clearly defined to avoid delays and misunderstandings with the supervisory authority.

Contract amendments

Employment or termination contracts for board members and senior executives should include clear, ongoing obligations to cooperate in the event of official orders for information or search warrants.

Updating dawn raid guidelines

Procedures for on-site regulatory actions should be brought up to date, including IT/cloud access and searches of former board members and individuals.

Proactive internal investigation of breaches

In the event of potential breaches, internal investigations should be initiated at an early stage. The voluntary disclosure of internal investigation findings can reduce the scope of investigative measures and may be taken into account positively by BaFin when imposing fines.

Oppenhoff’s Insurance Sector Group will be happy to assist you in identifying your specific needs for action and implementing appropriate measures within your organisation.

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